Angry but pragmatic, protestors fly the flag for nationalism

Outside a 14th-century Orthodox Christian monastery in the Serbian enclave of Gracanica, a crowd of about 4,000 embraced the symbols of Serbian nationalism with renewed vigour. They kissed the red, white and blue flag and sang patriotic hymns.

A handful of Swedish and Irish soldiers looked on from vantage points around the monastery, while undercover officers from the Serbian ministry of interior, identifiable by their virtual uniform of leather jackets and jeans, chatted to Serbian policemen. Their presence, just three miles from Kosovo's capital, Pristina, illustrated the challenge for the new government, elected by the ethnic Albanian majority, in enforcing its writ in the enclaves inhabited by the country's 120,000 Serbs.

Speaker after speaker at the Gracanica rally vowed that Belgrade would never abandon the Kosovo Serbs. In a rush to underline that commitment, Serbian officials have promised a new secondary school and broken earth for 70 new houses in the past two days.

The pledges of investment, after years of neglect, represented an effort to maintain parallel Serbian institutions to rival the sovereignty of the new Kosovo state. But Gracanica is an island amid a majority Albanian territory, and its residents voiced a correspondingly pragmatic attitude to cohabitation.

"We're not happy because they are taking our land," said one resident, Jordan Danic. "We'll wait to see what the government in Belgrade says, but meanwhile people will get on with life. We got on with the Albanians before and we'll get on with them now."

"Most people are sitting at home and waiting to see what will happen," said Goran Dancetovic, a local government official, arguing that residents were more fearful than angry. "It's not really a life if you are scared to drive down the road to Pristina," he said.

Meanwhile, in the largest of the Serb enclaves, Mitrovica North, close to the border, a crowd of about 8,000 rallied yesterday and chanted "This is Serbia" and "Down with the US" while raising three fingers in the sign of Serb unity.

They marched to the bridge over the Ibar river that separates Mitrovica's two ethnic populations, where the demonstration was halted by police backed up by Nato troops. The young men leading the crowd appeared to be under instructions to avoid violence. Instead they chanted anti-Albanian slogans and burned a US flag.

"Serbia must use all military means to protect those living here," said Marko Jaksic, the hardline leader of an organisation of Serb settlements in Kosovo. "We say no to this coup to create a new Albanian state in the Balkans. We are here to say rise up and reject the creation of this state."

The demonstration followed violence in Belgrade in which the US embassy was attacked and the Slovenian embassy set ablaze.

Lalica Slavica, a 43-year-old unemployed mother of five, who fled her home town of Pec eight years ago, said bitterly: "These are difficult times. We did not expect the EU to do this to us. What happened yesterday was designed to destroy the Serb state. The aim is to expel us. Then Europe will understand what's happening here."

In Pristina, members of the ethnic Albanian government expressed relief that the first 24 hours of the state's existence had gone by without serious violence or punitive measures from Serbia. The interior ministry in Belgrade issued charges against Kosovo's independence leaders, but a feared economic embargo did not materialise.

Nato and UN officials said goods and people appeared to be travelling normally across the Kosovo-Serbia border and water continued to flow from a Serbian-controlled reservoir in the north to the Albanian majority areas.

A Kosovo Serb official said Serbian members of the multi-ethnic Kosovan police force had begun to leave their posts, but that was denied by the UN mission. "All Serb police are accounted for," a UN spokesman said.

"So far so good," said an aide to President Fatmir Sejdiu, adding that the government had spent its first day since its declaration of independence focused on Brussels, New York and Washington, where the rest of world was contemplating whether to recognise Kosovo.

International observers warned that recognition could trigger violence in the Serb enclaves and stronger action from Belgrade. More demonstrations are expected on Thursday.

Serbian leaders have vowed to cut off cooperation with Nato troop contingents from countries that recognise the new state. Serbian local elections due in May could also trigger conflict if Kosovo Serbs try to take part and the Pristina government tries to stop them.

Simmering frustration over Kosovo's entrenched poverty provides another potential source of trouble. "People have been waiting so long for independence to change their lives," said Labinot Uka, a young ethnic Albanian in Pristina who, like many of his contemporaries, is looking for a job. "There's a lot of unemployment and there are hotheads on both sides. All it takes is one spark."

Shpend Ahmeti, an economic consultant who advises the government, said it would have to act immediately if it wanted to quell public frustration. He said Kosovo should immediately apply for International Monetary Fund membership, which could not be blocked by Russia. That would provide access to international credit and advice.

"I am hopeful, but the government needs to start working now," Ahmeti said. "You have to start reforms, so that people can see results. There is a huge will among the people to show the world we can do it. That is an asset the government can use."

State of play

Kosovo's declaration of independence makes it the world's 193rd state. It wrote to the other 192 yesterday asking for recognition, and says it expects about 100 to do so. Around 17 of the 27 EU states have already recognised Kosovo or are expected to within weeks - France and Britain did yesterday and Germany and possibly Italy and Austria are expected to follow suit today. Spain, Slovakia, Romania and Cyprus have ruled it out and are likely to be joined by Bulgaria and Greece. Outside the EU, the United States established ties yesterday, as did Kosovo's next-door neighbour Albania, but Russia and China will not. Of countries in the former Yugoslavia, Slovenia, Macedonia and Croatia will, but Bosnia and Montenegro are likely to follow Serbia in opposition.